Why Dave Shares Took a 65% Dive Last Month
Shares of financial technology company Dave (NASDAQ: DAVE) plunged 65.2% lower in February 2022, according to data from S&P Global Market Intelligence. Having launched through a special-purpose acquisition company (SPAC) on January 5, the stock is now down 51.5% from the first day's closing price.
So far, the company offers an overdraft protection service, a simple budgeting tool, a credit-building system for reporting bill payments to credit bureaus, and a search tool for freelance-style side gigs. All of these financial tools are managed via a smartphone app. Backed by Shark Tank billionaire and media profile Mark Cuban, Dave entered the market with high expectations, and the stock managed to climb a bit in January.
However, Dave ran out of steam as the stock market generally backed away from risky growth stocks trading at nosebleed valuations. Dave punched a ticket on this downward ride thanks to a limited operating history, deeply negative bottom-line results, and an unclear path to future profits. Moreover, the company has not yet reported earnings as a public company, making the financial picture even murkier.
Source Fool.com
